Question
The monthly sales of mufflers in the Richmond, Virginia, area follow the normal distribution with a mean of 1,200 and a standard deviation of 225.
The monthly sales of mufflers in the Richmond, Virginia, area follow the normal distribution with a mean of 1,200 and a standard deviation of 225. The manufacturer would like to establish inventory levels such that there is only a 5 percent chance of running out of stock. Where should the manufacturer set the inventory levels? Denote X to be the random variable "monthly sales of mufflers", and x to be the right inventory level the manufacturer sets, choose from the followings the correct way to set up for x:
a. P(X<=x) = 0.05
b. P(X<=x) = 0.95
c. x = P(X<=1200)
d. x = P(X<=225)
e. x = P(X<=0.05)
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